IRS: Your audit notice is in the mail

Consumer Reports News: April 06, 2011 11:43 AM

More than 1.6 million Americans were audited last year, and the majority of them got that news by mail. The IRS is relying more on mail than phone calls (or a surprise knock on the door) to query taxpayers about their returns. Almost 80 percent of audited taxpayers received notice by mail last year.

The latest figures represent a rise in mail audits by 13 percent over the previous year, continuing a long-term trend; mail audits are up 93 percent since 2003.

Auditing by mail costs less and the IRS states that on their end of things it is also more efficient. Depending on the complexity or details needed to explain your paperwork, however, you might find speaking with someone is easier than responding in writing. According to a survey by the IRS's Taxpayer Advocate Service, more than a quarter of 754 people audited because of claiming the Earned Income Tax Credit had no idea they were actually being audited, and 40 percent (of the same respondents) couldn't make heads or tails of what the IRS wanted them to send back.

About 10 percent of the mail sent out by the IRS is undeliverable, which means some Americans probably never even know they're being audited.

For some tips about how best to survive an audit read our risks of a home office article, which first appeared in Consumer Reports Money Adviser

Tax audits: 78% are done by mail, not in person [CNN Money]

—Maggie Shader